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CBILS Access for Hotels, Pubs, Restaurant and Hospitality Finance

The government backed Coronavirus Business Interruption Loan Scheme (CBILS) is available through the British Business Bank’s accredited lenders. The scheme supports businesses with up to £45m turnover and experienced reduced sales or cash flow due to Covid-19.

Eligible businesses can apply for secured and unsecured Business Loans, Overdrafts, Asset Finance and Invoice Finance of between £50,001-£5m from a range of lenders. Loans under £50,000 should consider the Bounce Back Loan Scheme (BBLS) that is 100% guaranteed by the government and available to smaller businesses or the Start-Up Loan Scheme.

CBILS provides a lifeline for hospitality businesses seeking hotel finance, pub finance or restaurant finance. The government guarantees 80% of CBILS loans and cover initial fees and interest during the first 12 months. Capital repayment holidays offered by some lenders, means some businesses pay nothing in the first year.

CBILS accessibility

Since launch on 23 March 2020, CBILS criteria expanded to allow more SMEs to access the funding. Changes include:

  1. Allowing viable firms with insufficient security to apply.
  2. Increasing the maximum business loan from £1.2m to £5m.
  3. Increasing the number of accredited lenders with 84 as of 05.6.2020.

CBILS applications and funding to date

According to HMT, 45,843 companies have borrowed £8.92bn, up from £6.9bn on 10th May 2020 – an approval rate of 51% based on 89,724 applications. These include applications in progress, ineligible applicants and declined applications.

Hospitality businesses owners should contact their own bank first to apply for CBILS. However, our experience indicates many lenders have been slow to respond to enquiries and borrowers have been frustrated by the process.

CBILS broker

There are various of reasons why using a commercial finance broker may be the best way to access CBILS. These include:

  1. The process is very demanding for the individuals without the knowledge or experience navigating the credit application process. A credit broker can speed up the business loan application process and ensure a positive outcome.
  2. Reputable commercial finance brokers have relationships with accredited lenders, including ones only accessible via a registered broker.
  3. Experienced brokers know which lenders to contact as many are unapproachable because they are:
  • Regionally focused
  • Not able to offer every type of finance available under CBILS
  • Sector specialists
  • Lending to existing customers only
  • Loan amounts and criteria vary widely.

Sadly, many successful and profitable businesses to struggled to raise cash flow finance to continue operating. Provided your business meets the CBILS criteria, we encourage pub, hotel, restaurant, coffee shop operators to contact us to discuss their business loan requirements.